Episode 73 – Copyrights and Trademarks in the Custom T-Shirt Business

Show Notes

Transcript

Welcome to the Custom Apparel Startups podcast, your best source for information, news, tips and tricks to get you off the ground running, and earn success with your custom apparel decorating business. So, get ready to soak up some knowledge!

Now, here are your hosts, Mark and Marc!

Mark S: Hey, everyone, and welcome to episode 73 of the Custom Apparel Startups podcast. My name is Mark Stephenson, from ColDesi.

Marc V: And this is Marc Vila, with Colman and Company. Mark, I’m stoked today, because we’ve got another guest with us. It’s a surprise guest. Mark’s actually never met this guy before. So, I’m going to give you some clues. He was a former President of a famous country. Not one of those little countries that you’ve never heard of, but a famous one.

Mark S: It rhymes with Fanada.

Marc V: Yeah. He’s won all types of awards all over the world, for all types of things having to do with marketing.

Mark S: Or more importantly, he could be a really highly qualified trademark, patent and copyright attorney, that can help our listeners understand the best ways to use trademarks and copyrights.

Marc V: Did you read the show notes, before?

Mark S: No, I did not.

Marc V: Oh, because that’s actually who it is. Oh, then, so be it. Seth Gardenswartz is here. We’ve had the opportunity to speak with Seth for a little while now, and you guys are going to love to hear everything he has to say. So, I’m going to give you a couple of seconds on why you’re going to love to listen to this episode, and why it’s important, too.

He’s a trademark attorney, but he’s not really boring or bland, like basically every attorney is, no offense to any attorneys listening.

Mark S: But he probably dresses well, like an attorney does.

Marc V: I’m sure he does. He rights notes like an attorney. But he has a specialty in marketing and branding, and not just doing trademark for marketing and branding, but actually understanding the concepts, and having experience in marketing and branding. So, you guys are going to get a bunch of great education about copyrights and trademarks, and also probably a bunch of great notes about marketing and branding, too.

Mark S: Yeah. Actually, his only award really is – the real one is the Heart of a Marketer award, the first time ever granted to an attorney.

Alright, Seth, defend yourself – I mean, introduce yourself to everyone here!

Seth G: First of all, full disclosure, I am not a patent attorney. That’s a whole separate wardrobe, which I just can’t pull off. So, thank you for that introduction.

As we were talking earlier, I really grew up in a local business. My folks had retail sporting goods stores in a couple of states, and several cities. And actually, my grandparents were in the business before that. So, I grew up with a real front row seat on the task of a local merchant, marketing their brand and their identity to the prospective consumers.

Also, because we were retailers, we were also marketing the goods of some of our vendors, which were Nike and Oakley and Adidas and Spaulding, and some of the very big brands – Trek Bicycles – that people interact with, and I got to really see and learn from those professionals.

Then, dad sold the business, and I had a crisis, and went to law school. Now, I’m trying to recover by focusing on something that builds value.

Mark S: There you go. I appreciate that. So, you’ve got a history of companies with no sense of humor at all.

Seth G: Yes.

Mark S: About their brand, and how you use it. And this is the kind of question we’ve got, if you listeners, if you’re not already a member, you should be. We’ve got a group on Facebook called Custom Apparel Startups. There’s a little over 9,000 professionals, or people that want to be in the custom t-shirt business, that are in there every day.

They’re asking questions about the business, and one reason that it’s great to have you on today, Seth, is that the most common questions are the ones that we are going to ask, and you’re going to talk about.

The first one is kind of what’s the difference between trademarks and copyrights, and really, why does that matter to people like our customers?

Seth G: That is a great question, and I wish more people asked it. There’s three sort of standard protectable registerable forms of intellectual property. One of the core things to understand about intellectual property is it’s property. So, what is property, you may ask yourself. Do you know? Mark, do you know?

Mark S: Normally, it’s like something I can hold. That’s what I think of. I think of property as something you -.

Marc V: It’s something that you own, that you have stake to.

Seth G: That’s all true, but it’s a little circular. So, what does ownership mean? That’s like the super excruciatingly experience you might have in law school. “Okay, Mark. That’s good. What does ownership mean?”

Ownership fundamentally means the right to exclude. So, if you have ownership of anything, you are able to exclude somebody else, in some way, shape or form. You think about your house. You can say “Hey, Marc.” You can make Marc not able to come to your house. And other people can’t just walk into your house.

Mark S: I’ve done that. We have forbidden each other.

Seth G: You can even put a sign up. So, intellectual property gives you the right to exclude people from using that property. That’s important to understand, before we talk about the differences, the differences between trademark and copyright.

Copyright is the ownership of an original work. If I draw a picture or if I write a song or if I sing a song or make a video or take a photograph or write some code, then I own that original work. And my rights, my copyrights attach as soon as I publish them. In other words, as soon as I make them available to the public.

So, my ownership right prevents somebody else from copying them. Of course, you’re familiar with every NFL broadcast, you hear “This broadcast is exclusive property of the National Football League, and any rebroadcast,” blah blah blah. What they are saying is you can’t record that and rebroadcast it for profit. It’s theirs. They created it. They spent a ton of money and resources to deliver that broadcast, and they own it.

And there’s all kinds of little niche examples of what is copyrightable and what is not copyrightable. But essentially, think of it as – well, let’s use a t-shirt as a metaphor. If I draw a picture, and it just comes to me, this vision for this picture, and I draw it, then I own that drawing. As soon as I published it. For me to establish the copyright, I have to publish it.

So, if I post it online or if I put it out there for the public to see, then that point in time is where my copyrights attach.

Now, if somebody buys, let’s say Mark, you love this little image I created. You say “Hey, I want to use that as the logo for my company.” Then, what you’re saying is “I want to use this image for the public to identify me.”

So, I think a lot about, copyright is the what. The what is the creative work. And trademark is the who. Like who do you think of, when you see that creative work?

If you take my triangle with the squiggle in it, and say that’s going to be your logo, then what you are saying is when people see this logo, you want them to think of you. If you put that logo – like I may have thought of it as this image on the chest for a t-shirt. But you may say “No. I’m going to make this little logo inside the label, in the inside back of the t-shirt. When people see that label, they’re going to know that this t-shirt came from my company.”

Does that make sense?

Marc V: Okay. So, maybe if – and this might not be a perfect example, but the way I’m thinking about it would be if, say Nike as a brand comes up with a design for a t-shirt, a guy running, and a lady giving him a high five, and that’s the t-shirt. Then, they might copyright that design. No one else can reproduce that design. They own that. They have ownership of that design.

However, the swoosh, which they also have ownership of, that’s their trademark, because you don’t identify a guy high fiving a girl running, as Nike, but the swoosh identifies Nike.

Seth G: That’s exactly right. The design of their products are copyrights. There’s another niche field which is too geeky to involve with, called design patents. But essentially, that design, that image on the front of the t-shirt, the runner getting the high five, that’s an original work. They own it. And fashion has its own sort of rules, but you can’t just copy that image.

So, if you go find that artwork out there on the internet and right-click on it, and download it, and upload it to your graphic program, you are stealing that original work, essentially. The way we say that is infringing, because of course, we have to invent a new word for what we’re doing, so that we can charge more for it.

But infringement is much more expensive to deal with than theft.

Marc V: What can be really tricky about this is when we think about making something, we think about that you took wood, and you chopped it up, and you ground it down, and you made it into a little wooden table. Just a tiny little doll table. And somebody takes that – now, you might have gotten the wood for free, from your yard, a piece of scrap wood. But you took time and you made it.

If somebody were to walk into your house and take that, they stole that from you. Now, the tricky part about graphics and t-shirts is somebody took something for free, basically, which is digital dots and stripes and colors.

Mark S: Right. It’s not an object.

Marc V: Yeah. It’s not an object that they took, but they still took time, and they made something. However, it’s much easier to take it, because you can just right-click it. You don’t have to go into their house and take it. But either way, their time, effort, creative work that they did, is something that’s being stolen.

Seth G: Yeah, it is. And we’re about to get deep here, because this is where this amazing system that we have protects innovation. The whole idea behind the patent and trademark office is to protect innovation, so people can’t just steal your stuff, which would create a disincentive for you to go create things.

Like before there were things like patent protection, if you invented a new way to make shoes, the shoemakers’ guild would come burn your house down, or they would just steal your idea. There was no upside for it, for you. But in this case, on the patent side, and patents are how, the government basically gives you a 20-year monopoly on how you’re doing something, as long as you tell everybody else about it.

That way, we all get to benefit from the knowledge, but you get to benefit from your work. And in copyright, if you create the special design, you get to benefit from that work, and you are able to show it to the public, where the public can potentially copy it, right-click it, etc., but you have that protection.

Mark S: Do I have to do anything, to copyright? If I just do a design, if I do an original design, and I put it up on my t-shirt store, is that act copyright?

Seth G: You own the rights to it. When you publish it, you’ve got the copyright. However, it is not registered. When you register it, you get some additional very valuable tools. You get the right to statutory damages, because otherwise, you’re only going to get actual damages.

And actual damages, like if someone sold two or three t-shirts, then your actual damages might be the profits from those two would-be t-shirts, or what your fee would have been, and that’s not enough to engage somebody who wants to take that on for litigation.

Because, and you might be shocked about this, there are no copyright police. There are no government employees who run around looking for infringers. You have to enforce this yourself, and that costs money.

If you register your copyright, you get statutory damages, and a lot of us on this podcast have probably gotten some nasty cease and desist letter from an independent attorney working for, I don’t know, maybe Getty Images, who has found somebody that has right-clicked on an image they saw someplace, and used it in either a publication, without permission, or much worse, on a product that they’re selling.

These guys basically get paid on contract. They have sophisticated programs that find those images, and they trace it back to the registered website, if it’s an online usage, and you get these C&D letters. Particularly, when those copyrights are registered, they get all of those tools. They get statutory damages, $750 per instance, and it can go way up from there.

And if it’s willful, it could be$150,000. You get attorney’s fees, you get those kinds of things. So, if you create an original work, let’s just say an image, and you’re planning to use it commercially, it’s worth it to register it. Copyright registration is relatively easy and/or inexpensive. Trademark registration can be much more involved.

Marc V: So, if I had a t-shirt store, and I had 100 original designs, and I decided I wanted to copyright all of those as mine, ballpark, how much effort, like hours of work, and money might I expect to spend, to do that? Because I’m always looking at what’s going to be my return on that, if I have to infringe?

If I have 100 designs, but I’m not that big of a store, and I don’t plan to be that big, because I’m really just a micro-small business. I’m only going to sell 500 shirts a year. Is it going to be worth it, if somebody steals it? Versus if I really want to grow big, and I’m hoping to sell 10,000 of each shirt, in five years. I can see the copyright, that math is easy on the big one. What about the small one?

Mark S: What are those numbers?

Seth G: The standard filing fee, the fee that you pay the government to register your copyright, is $55. It can be a little bit less, if you’re registering one work that you made yourself. In other words, if you go back to the example of your shop, odds are you probably hired a contractor to help create some of those works. So, now we’re back to our $55.

There are group registration rates. If you’re going to have an attorney do it, I would say, if you came and said “Hey, I’ve got one copyright. How much is it going to cost to register it?” They’re going to charge you to set up the relationship. You’re going to sign an engagement letter. It’s going to be a little bit more to do one, than to do ten at a time or 100 at a time, or to say “Hey, you’re going to be on retainer. I’m going to file five or ten of these a month.”

The fee to the government is $35 to $55 per original work. If you think about what that’s worth to you, like having that copyright for any one of them may not ever look like something valuable. If you go to sell your company, they’re going to want to know that you’ve got rights in all of that artwork, because the fact is – let’s use the example.

Let’s say you’ve got this t-shirt company. It’s an online store, and all you do is design original works, and sell them. Let’s say I want to buy your company. What am I buying? Let’s say I’m a big screen printer. The only thing that you’ve got that I don’t have, is intellectual property. You’ve got the designs that I want, because that’s special. It’s obviously creating cash flow for you.

And you’ve got a brand, so because you’ve sold these t-shirts, and because you keep bringing these particular designs to market, when I see one of those designs or when I see the name of your company, I think “Oh! That’s probably going to be a cool design.”

If you take it a step further, if you walk into a department store, and you see a Piranha t-shirt, you go “Well, Piranha has got really cool sort of fitness and yoga inspired t-shirt designs. And even a pretty plain t-shirt with just that little Piranha logo in the corner there, that evokes a certain feeling for me, almost independent of the design that’s on that particular shirt. Because when I see or hear the name Piranha, I think of all of the cool stuff I’ve ever seen them do, or all of the crappy stuff I’ve ever seen them do.”

One of the Disney guys, I think it was Michael Eisner, said a brand – now we’re going on to the brand piece – a brand is not a trademark. The brand is the living, breathing, constantly evolving compilation of all of the things, all of the experiences that you’ve ever had with that company or with that entity. It’s basically the feeling that you get when you see that brand.

It can be a really good feeling, or it can be a really bad feeling, or it can be a kind of uncomfortable feeling. Like when you see Edsel, the brand, the car, wound up becoming a brand for kind of a failed product, like a miss, like a difficult day.

Whereas Tesla has a very different brand. When you think Tesla, it’s like “Oh! Tesla is now making cellphone batteries.” You’re like “Wow! It’s probably a badass cellphone battery, because their cars are amazing!”

That brand gives you pricing power. It gives you that additional feeling. Someone asked me this question once. I do a lot of work in the craft beer space. Imagine you’ve got two identical beers, one in a blank can that says “Beer,” and the other in a can with a brand on it. The value of the brand is how much more you can sell a branded can for.

Mark S: That makes sense. Let me ask you, since you mentioned, as one of your examples – this is a common thing for our customers, that it sounds like has to do with copyright. Everyone knows that a few companies, like Disney, Universal, Warner Brothers, have swat teams of copyright attorneys that fly around the country [inaudible 00:22:11] use their logos.

Marc V: They do. I’ve seen it.

Mark S: Allegedly. But what will happen is they will say a couple of things. They’ll say “Well, I’m just doing this for my family,” or “I’ve just got these couple of shirts that I want to print, that have Mickey Mouse in the corner, but the rest of it is my design.” Can you talk about that kind of scale of trouble and not trouble?

Seth G: I would say that would be kind of like going into a biker bar and hitting on one of the boyfriends or girlfriends of the people there, and saying “Hey, I just thought she was cute.” You’re asking for trouble that you cannot dig yourself out of.

Let me back up for a second. First things first. Why do you have the mouse in the design? Ask yourself that first. If you’ve got the mouse in the design because it kind of reminds you of Disney or Mickey, you’re screwed, and you’re done, if you use it. Because they are going to shut you down. And that’s not copyright. That’s trademark.

That mark identifies their brand. It doesn’t have to be an identical copy. It only has to create a likelihood of confusion in the mind of the purchasing public.

Mark S: So, if somebody thinks it might be a Disney shirt, they think it might be, then you’re in violation.

Seth G: Exactly.

Marc V: It reminds me of, we had this customer – this was so long ago. But he had this idea of making flags for like college football teams. All he did was he put words that were nothing related to the team, but they were in the colors, and the fonts that he used kind of looked like their fonts, but they weren’t.

So, although it was in no way – it didn’t look like it. It looked kind of like it. However, when I looked at it, I was like “Oh, that’s Penn State.” He’s like “Yeah, it’s a Penn State flag.” He got shut down for doing that. He was starting his business.

Seth G: This is what I like about trademark law. Of course, you don’t like it if you’re the guy getting shut down. But what I like about it in general is it’s very practical. The bummer about it is there’s no bright lines, because it’s very practical. It’s hard to create bright lines, when you’re trying to be practical.

But if you’re creating a likelihood of confusion, and he was doing it intentionally, right? He basically said “I want to make something that makes people think about Penn State, but is not an exact copy of Penn State.” So, he may not have been infringing on one of their copyright written designs. But he was definitely infringing, on purpose, with their brand elements.

The law on this is – one of the cases that we read about this in law school was about two restaurants that were both, it was Dos Pesos versus Taco Cabana, I think. I can’t remember who was the plaintiff and who was the defendant. But basically, the plaintiff was complaining that the defendant’s restaurant just looked a lot like their restaurant.

It wasn’t any one specific thing. It wasn’t like their sign was identical or their name was identical, or even close. Not at all. They were saying that the overall impression was close enough, that people would get confused. That’s actually called trade dress infringement.

A trademark doesn’t have to be a word or image. It can be a shape or a color or a sound. Dun-dun-dun, you hear that sound, that NBC sound, or back – most people won’t remember this, but people used to make collect phone calls, and when you made a collect phone call, AT&T had that specific sound they would make, if you dialed that number.

Those are trademarks, because when you hear those sounds. Harley Davidson has trademarked the sound of their exhaust, because they know that other companies are going to try to tune their engines to sound like a Harley. And they’re like “No. That’s part of the overall commercial impression of our brand.”

It’s smart, right? It makes sense.

Mark S: That is so interesting.

Seth G: So, trademark is pretty broad. A lot of people think they can sort of get away with “It’s not the exact font, but it looks like it, doesn’t it?” That “It looks like it, doesn’t it” part is the part that will get you in big trouble.

My home base, although I do work all over the country, is in this sort of medium-sized metro area. There was a bakery here, a little local bakery in a strip mall, that opened. It called itself “Doughboy.” It opens up, it calls itself “Doughboy,” and there’s a fun little blurb in the paper that there’s a new bakery on the corner of whatever.

It just so happens that there is a, coincidentally – this probably wouldn’t have mattered, but there is a General Mills plant here in town. Apparently, the owner of the bakery gets a cease and desist letter from General Mills, saying “Hey, you can’t use Doughboy for a bakery. We own the trademark. And by the way, we’ve owned it for 50 years, and it’s probably one of the most valuable assets we have.”

The owner was like “Dude! This is crazy! I just have a little tiny bakery. Doughboy was my nickname in school. They can’t take that away from me.” Oh yes, they can. You cannot identify yourself as a bakery, when another company has spent hundreds of millions of dollars over decades, investing in that trade name, so that customers, when they see it, they think of them.

It turns out that somebody had wandered into the plant and said “Oh, cool! You’re opening a retail store here in town.” They were like “What?”

So, don’t think that you can say “Oh, well, it’s small. It doesn’t matter.” No. The big companies, it matters a lot. It’s their biggest asset. They know that. They’re responsible to the shareholders. They can’t say, even if they love the little bakery, they can’t say “We’re going to cut you some slack.” They cannot do that. They have fiduciary duties to their investors. Institutional pension funds. It’s not going to happen.

[inaudible 00:29:34]

Mark S: You’re saying that I wasted my time in naming my daughter Coca-Cola?

Seth G: You know, did you waste your time? Probably. But is it trademark infringement to name your child after a brand? It’s probably child abuse, but it may not be trademark infringement, because, and this is another thing.

If Doughboy was a hardware store, General Mills would have had a really hard time shutting them down, because a member of the purchasing public is kind of unlikely to go “Oh, cool! They’re selling hammers and power tools now.” Not really.

But they’re selling baked goods, yes. Now, if they were selling prepared meals, as a restaurant, I don’t know. That’s sort of more – now we’re back in law school. It’s like “I don’t know. Where’s the line?”

Mark S: Can we run through some examples of typical questions that we get, and you can maybe give us some guidance on those?

Seth G: I don’t know. Do we have an engagement agreement signed?

Mark S: Yes, we did. No, we don’t.

Marc V: Yes. This is not legal advice. And I’m going to preface the entire podcast on this. We’re talking about this to help you get educated, so when you go to your own attorney, or your own trademark attorney, you’ve heard some of the words before, you understand what you’re getting into. And also just teaching you a little common sense, to say “Hey, I should probably check with an attorney.”

I think maybe we can agree all together, that the message is the whole purpose of this podcast is to check with an attorney.

Seth G: I would say I don’t want to make it sound like I’m trying to just help my colleagues do nothing but make more money. But I think exactly what you said. This is about issue-spotting. I don’t want people to say “Oh, I know. I won’t use the same words or exactly the same font, but I’m going to use the same colors and make it, because that will make the public think that it’s theirs, but it’s really not.”

Don’t do that. That will cost you a lot more money than calling your attorney and having a five minute conversation, saying “Can I do that?” They’re going to say no.

Mark S: Speaking of common sense, I really love what you said about if your intent was to make it look like something, then you’re in the wrong. I mean, that’s fair.

Marc V: That’s true. The thing about that is true, and why this is common sense, is because if, for our listeners out there who are parents, and your child maybe does not bring home a specific letter from their teacher that’s something bad. They leave it in the locker.

Then, the mom “Oh, how is school going?” And they kind of vaguely answer, but they don’t actually lie. They don’t actually. They just kind of misdirect everything. Then all of a sudden, parent teacher conference day comes, and he says “Oh, about this.” “Wait. I didn’t.”

So, you talk to your child, and “Well, you didn’t ask me about that.” The whole purpose of it was like “No. You were attempting to misdirect me. It was on purpose.” That’s what you could do with this copyright and trademark stuff. It’s like “I changed the ear shape and I changed the color.”

No. You were doing it on purpose.

Mark S: I’ve just got two comments about that. The first thing is I’ve met Ella, Marc’s daughter, and she would never do that kind of thing. And I’m also equally sure that at least half a dozen times in Marc’s early life, that he did do those things.

Marc V: Oh, I’m sure that I did all of those things.

Mark S: So really, Seth, what I was going to ask you about is you had mentioned the words and phrases thing, and that is something that comes up a lot. Can I use a slogan that’s been on another shirt, or that a company uses?

Seth G: This is a good example of where copyrights and trademarks can get confusing pretty quickly. The statute says it protects the original works of authorship fixed in any tangible medium of expression. Alright? So, it prohibits the actual copying.

Now generally, short words and phrases, names, titles, slogans, are generally not protected. However, those things, if they become trademarks, are totally protectable, and will be protected.

So, I wouldn’t rely on seeing, if you’re copying something, I would say don’t do it. If you really want to do it, try to get permission. Because if you’re selling it, odds are at the very least, you’re going to have to go defend yourself and say “Oh, no. This copyright doesn’t apply because it’s too short. It’s a two-word phrase. It’s commonly used.” Why bother getting into that?

Mark S: But for example, let’s say that I’m starting a t-shirt business, and my niche is MMA. I’ve seen shirts all over the place that say “My son or daughter kicks ass in MMA,” or “I’m an MMA mom.” They’re out there, and they’re published. Is that the kind of thing that I should be worried about, or consult an attorney about, before I put it on my own shirt?

Seth G: In general, that’s the kind of short word or phrase that is so commonly used, like you’ve got an MMA mom, and you’ve got a hockey mom and a soccer mom and a band mom and a chess mom, all of that, a World of Warcraft mom.

I think that, and again, I’ve done zero research on this issue, so this is not legal advice, and you are crazy if you take it as legal advice, but that is probably less likely to be a problem.

But let me give you an actual example that I think is in this industry, which is the 12th man. The 12th man was, I think it was Texas Tech that was using the phrase to talk about their home field advantage. They actually filed for and got trademark protection in the 12th man. What they are saying is that when you hear that phrase, you are thinking about the 12th man as our home field advantage, our home team, our fans and crowd.

A couple of other college football teams started using it, and they sent out some what I assume to be initially kind of polite letters saying “You can’t really do that. We own it.” They all stopped, and then a couple of them signed license agreements.

The one that didn’t comply either way, was the Seahawks, and they wound up in litigation. Ultimately, they settled for money. Now, the Seahawks have the right to use the 12th man, but they are paying the original trademark owner. 12th man is a two-word phrase, and you can say it in numbers or you can say it in letters. You can say it in pictogram. You can have the number 12, and a symbol of a man.

That’s still going to have a commercial impression that would make you think of that 12th man. So, if you go try to use that, you are infringing, potentially, if you use Seahawks colors, you’re going to be infringing on the Seahawks’ right to use it, which they have bought and paid for, or Texas Tech’s right.

So, the answer, and I’m going to give this [inaudible 00:37:53] super valuable. I’m going to give you the answer to every legal question you have ever had, or ever will have. Are you ready? The answer is always “It depends.”

Mark S: I thought you were going to go with “Consult your attorney.”

Seth G: No, no, no! It’s not “Consult your attorney.” But you’ve got to know what it depends on.

Marc V: I can see that, because you mentioned like the doughboy earlier. So, it’s like I own a hardware store and I name it Doughboy, but I don’t actually have the picture of the doughboy anywhere near it. It’s not even in the same colors, and I can prove that that’s my nickname. It’s in my high school yearbook, and it’s just Doughboy Hardware. There’s probably, in that case, it would be a big attorney battle back and forth, and eventually a judge, to close that down.

Compared to where, if that store in the mall you mentioned, actually had a picture of the doughboy on the window, it’s much more obvious.

I have two questions that maybe you can answer quickly, or back to back, even. One is, how do I know? Is there a way to easily check? Like I’m in Alabama, and I want to put Roll Tide on a shirt. Is there somewhere I can go, to find out if Alabama took the rights to that?

Seth G: Sure. You can go to the USPTO website, and you can search. There’s a trademark search feature there. And full disclosure on this, I as a trademark attorney and a lot of trademark attorneys actually do things like trademark clearance and trademark searches. So, even though you can search on it, you may or may not be able to interpret the results.

But they’ve got a lot of self-help tools on there. There are a lot of resources. Actually, I’m on a panel next month, at the craft brewers conference, with members of the PTO. One of the things they want to talk about is that there are a lot of resources for individuals to go do some of this work themselves.

If you go to USPTO.gov/trademark, there is a little green button in the upper right corner called “Quick Links.” And then, there’s one called [inaudible 00:40:25], which is the search trademark database. You can go do a basic word search, ,and just punch in the exact phrase you are looking for.

So, I’m going to do Roll Tide right now. Too bad we’re not on video. And I see -.

Marc V: While you’re doing that, the way I see it is like this. If you go to the biker bar and you see a woman that you find attractive, and you want to go hit on her, and there’s a guy with his arm around her, that’s the equivalent of you going to this website and seeing right there, it says yes. Right?

The arm is around. This is probably this guy’s girlfriend. If you go and she’s sitting alone, that doesn’t mean she’s single. So, if you go to this website and you don’t find it, it doesn’t necessarily mean that it doesn’t exist. It’s just that it’s not apparent at this moment.

So, you could hit on her, and then he could come out of the bathroom. You could print this t-shirt that says whatever it is, because you didn’t find it online. But it doesn’t necessarily mean you’re out of the woods. It doesn’t mean that you have to be scared about it. It’s just important to remember it depends.

Mark S: I’ve just got to say I’m very uncomfortable with a lot of the examples.

Marc V: No, we’re doing good today. What did you find on Roll Tide? Let’s talk about that.

Seth G: If the trademark is registered, it doesn’t matter whether you look at it or not. You have what we call in the law biz “constructive notice.” So constructive, in case you’re wondering what that actually means, in this case it means “not really.” So, you don’t actually have notice, but the law says we’re going to treat you like you did have notice, because you could have gone and looked it up. And if you didn’t do it, tough luck. We’re going to treat you as though you have. Make sense?

So, Roll Tide is an active registered trademark of the Board of Trustees of the University of Alabama; in class six, for key rings, metal license plates for land vehicles, and license plate frames; in class 16, for notebooks, loose-leaf binders, writing papers, blah blah blah; in class 18, for tote bags; in class 20, for stadium cushions; in class 21, for drinking mugs and stuff like that; in class 25 – this is the big one for us – for t-shirts, ladies and men’s, sweaters, sweatshirts, blazers, yada yada yada; in class 27, for doormats.

Interestingly, it was cancelled in several other categories; for candles, for racket covers and basketballs, and for ashtrays and lighters.

Marc V: There you go! There’s the business! Roll Tide ashtrays. I’m buying the URL on GoDaddy right now!

Seth G: We should probably, not on this call, we should talk about it. So, you can go search the database. One word of caution is that people will say “Hey, I searched the database. I didn’t find it. I’m good, right?” Wrong. What’s the answer? It depends. The answer is it depends.

Marc V: That’s like the boyfriend was in the bathroom thing. You went in there and you didn’t see somebody with his arm around her. Well, it doesn’t mean that she doesn’t have a boyfriend, and that he’s not just in a place where you couldn’t easily find him, compared to if you would have hired a private eye. This is creepy.

You hired a private eye. “This girl in the bar, does she have a boyfriend?” You hire a private eye for two weeks.

Mark S: This is so, so off track.

Marc V: If he doesn’t find it, then you’re probably highly likely, but still, it depends.

Mark S: Let me completely derail this part of the conversation. Let me ask you, because in addition to whether or not we can use this phrase, and whether or not we can copy this image off of one of our competitors, or off of some national brand, we also get the question about your own trademark, like your own business name. Your own letters. How do you get and keep a good trademark?

Seth G: Yeah. That’s a really good question, and this is what I do every day. First of all, you want to start with a good mark. A lot of my clients come to me when they’ve already been in business for a couple of years, and they’re kind of pretending that they don’t want to know, but they know there’s something that they should know about.

The first thing to do is to check and see what the name space looks like around your business name right now. Because a lot of people think that they go, like if you’re in Florida, let’s say the four of us, Mark, Marc and Seth want to go and open a taco truck. We just register our LLC with the state of Florida, and it says Mark, Marc and Seth is your LLC. It’s your corporate name.

You’re like “Great! I’ve got it! Right?” That is not true at all. All you’re doing with the state corporations division is creating a unique name that, and it can be unique by one letter. They don’t care at all. It’s not your trade name. It could be your trade name, but they don’t do any additional checking around that.

If instead of a taco truck, if we were going to do a real estate project, we might buy a piece of land, subdivide it into three parcels. Parcel one would be MMS One, parcel two would be MMS Two, and parcel three would be MMS Three. Those are not distinctive names.

But then, we might call it “Lagoon of the Bottomless IPA.” That would be the name of our subdivision. Assuming that that name is not confusingly similar to something else, and is distinctive, which it probably is for a residential or office real estate project, then we would have the opportunity to go and apply for trademark protection.

If you don’t apply for trademark protection, a little bit like copyright, you still may have common law rights. But the most important thing, back to your question – I’ll try to answer it – is to get and keep your trademark, first understand if you’re in business, what the main space is. If you’re not in business yet, if you’re about to open a new business, I really encourage you to work with a professional, to help you find a name that is distinctive.

I would start with that, way before your logo. Your logo is secondary. You’re going to change you’re logo. I promise you, you’re going to do it. If you can lock up the name first, that is much more important. It’s broad.

When people ask you “What kind of shoes are those?” I don’t draw them a picture, right? I say “They’re [inaudible 00:47:58].” So, the internet search is based on that. That’s super, super important.

The two reasons that peoples’ trademarks don’t get registered or they wind up in litigation, or they have other problems with them, most commonly number one; it’s confusingly similar to something else. Number two, this happens all the time, it is descriptive, too descriptive. What that means is if your name describes what you do, the government is not going to give you a monopoly on those descriptive terms.

If you are Miami T-Shirt Shop, and you’re in Miami and you sell t-shirts, they’re not going to say you’re the only one who can use Miami T-Shirt Shop in your name, or T-Shirt Shops in Miami. They’re not going to do that. It is what it is. It doesn’t distinguish you.

If you’ve been in business for five years and you’ve managed to prevent anybody else from using that mark, and now the public only thinks of you when they hear that name, then there’s what’s called a secondary meaning, a 2F way to protect that. But it’s a bad place to start.

And a lot of people want to start that way, because they want people to see the name for the first time, and know what you’re doing. A valuable trademark is the opposite. It’s you see a name that is completely distinctive, but they come to associate it with a particular business, like Starbucks.

Do you know where Starbucks comes from, the name? Anybody?

[inaudible 00:49:34]

Seth G: Close. It’s a book. It’s [inaudible 00:49:44] Starbuck. Nothing to do with coffee, in 1972. Today, when you say Starbucks, you don’t think of coffee. You think of that coffee. That is a strong mark, because they have invested years, dollars, millions of impressions, to develop that recognition. So, distinctiveness is important.

There’s a bunch of other reasons, and I get these occasionally. Primarily, a surname. If it’s offensive, they’ll refuse protection. There’s a very interesting Supreme Court case about that this year.

But starting off right is really important, and I think for those of us who are in the apparel business, particularly screen printers, screen printers have their own brand. And you guys have a brand, for example. But your clients have brands, too.

Like at screen printers, we see a lot of client marks. I think it’s helpful to understand, maybe to help some of those clients, point them in the right direction, in terms of what the marks are.

A couple of things I want to talk about on this podcast today, when people give you a piece of artwork, whatever your intake form says, it should have them represent that they own or have rights to that artwork, and they will indemnify you in the event that somebody else thinks that it’s infringing.

What that means is if I bring you, Mark, a piece of artwork, and I ask you to print it, and it turns out somebody else says it’s infringing, they’re going to sue me. But they’re also going to sue you. You want me to promise to defend you, to step into your shoes and say “This is my problem. I’ll take care of it.”

Mark S: I like that. That’s great.

Marc V: Yeah. That’s important.

Mark S: If I have what I think should be a trademark right now, is there something that I should do, specific steps that I should take, in order to protect that?

Seth G: The first thing that I would do, and you can do this any way you’d like. You can talk to an attorney, you can do some initial research yourself, or you can do a combination. The first thing I would do is what I call an audit. Understand what your rights are, what your challenges are, in that mark.

I work with a lot of craft brewery clients, and typically, they have a house brand. So, they’ve got the name of the brewery, Acme Brewery. Then, if they’re a production brewery, they’ve got four or six SKUs that they put in cans and they distribute.

I would say first, audit each of those brands, each of those marks, and understand what the competition, what the name space is. When I say the competition, I want to know is anybody else using something that is that mark, or confusingly similar? Are there any applications or registrations for that mark, or that are confusingly similar? Where are those people? Who are those people?

When I do this as a lawyer for clients, I usually give them back a report that says “Okay, here’s the five names we looked at, and here’s what I saw for each name. These are the challenges. This is how serious I think the challenges are, and this is who the challengers would be.”

For example, if I had been representing that bakery, I would have said “Dude, it’s General Mills. It’s a direct infringement. Change your name now.” That’s what I would have said, because General Mills is not going to back down, and they’ve got no defenses.

And by the way, it’s completely worthless for you to fight it, particularly if you’re a new brand, because your brand is meaningless to everyone but you. Your brand becomes valuable, as the public interacts with it. So, fighting a trademark dispute early in your company’s history is kind of a waste of time. You’re better off finding a better brand name, because your return on investment in that is going to be a lot higher.

Some people say that trademark fights are good, because you get free publicity. It depends. It’s a very dangerous game to play.

Mark S: It doesn’t sound good to me. Okay, we’re about to wrap up. We’re getting close to time, here. But I did want to ask a couple of questions that we’ve gotten on our Custom Apparel Startups group, related specifically to this. And these are kind of common things that we hear, and that we get questions about, before we finish.

Marc V: I think we have, we’ll probably have like three or four more questions, so let’s lightening round them out in like five minutes or less.

Mark S: Sounds good. We’ve got one lady, Helene, on the CAS group, that she writes books, and she sends them off to the copyright office, and that handles the copyright part for her, on that part of her business. Can she send embroidery designs on a CD, to the copyright office, with the appropriate paperwork and fees, and have that serve as a [inaudible 00:55:25] to get the copyright?

Seth G: I would probably not want to answer that question without a little bit more detail about it. I mean, she’s going to have to submit a sample of her design, and she’s going to have to basically show that she’s published it. So again, going back to what copyright protection covers; original works of authorship, fixed in any tangible medium. So, on a CD is probably a tangible medium, but this is not how they are going to be used.

If she published the embroidery works on her website and said “Hey, these are examples of my work,” or “These are designs that I have available,” that’s probably publication. And can she submit it electronically? When I do trademarks, it’s all electronic, today. All of my specimens, everything is electronic.

There are some people who like to do it the old-fashioned way. The office actually charges you more for it. It takes longer. Electronic submission is really the norm.

Marc V: Okay. One thing is something that I had written down, so I think we can answer this really quick, nip it in the bud, just to be very clear. What I’ve heard 1,000 times, I’ve read it on Facebook, I hear people say it in their training classes, I hear customers say it on the phone, “Well, if you just change the design by 10%, you’re not going to be in copyright infringement.”

We’ve explained it probably in the first 20 minutes of this podcast, that that is clearly no. Right?

Seth G: If you are trying to make it technically different, but have a similar commercial impression, that is a really bad idea, because first of all, I’m going to claim, if I’m the holder of that original work, I’m going to claim that I’ve got – forget about copyrights. Let’s pretend copyright didn’t exist. I’m going to say “Hey, I’ve got common law trademarks in that, and what you’re using is confusingly similar.”

So, you’re not just having a copyright issue. And the 10% rule, that is the kind of thing that people get into trouble with all of the time. Did a lawyer tell you that? Did they look at your work? Did they look at what it was? What does 10% mean? 10% of pixels? That’s not a good idea.

Marc V: So, just a general thing is just because it’s different by 10%, and you’ve figured out how that math works, don’t base your business off of that.

Seth G: I’ll give you a real world example, that is really illustrative. Do you remember the former President of the United States?

Mark S: I never met John Adams, but I like his work.

Seth G: There was this guy Barack Obama, and he was running for President. A very famous artist made a poster of him. Remember that? Shepard Fairey. It was a very graphical image of the then-candidate Barack Obama. So, that image was a derivative of a photograph that was taken by a photographer, and published by the New York Times.

Just recently, the New York Times and Shepard Fairey settled the lawsuit for copyright infringement. So, do you think that poster was a 10% change from the original photograph?

[inaudible 00:59:40]

Seth G: Do you think they enjoyed being in eight years of litigation and uncertainty?

Marc V: Yeah. So, the next thing that we have is the little R with the circle, and the TM, right? Nike does not have to put a TM or R or whatever it would be, I think TM, in that corner, to make it trademarked. Right? That doesn’t mean I can copy it, because it doesn’t have the TM next to it.

So, is the TM and the R really just for showing off? Or does it actually have any – because I’m looking at Mark Stephenson’s shirt, and he’s got an embroidered R. But if he didn’t, that doesn’t mean somebody could copy it. I guess what’s the point, besides showing off?

Seth G: First of all, those two symbols mean something very different. The TM, basically, is just you saying that you feel like it’s your trademark. You’re saying that this is – it’s kind of like your statement that you’re using this as a trademark. So, you’re providing some notice in that mark. And you don’t have to use it every time.

A lot of times, if you look at a press release, you might see the symbol in the first instance, maybe in the headline or maybe in the first sentence, but they’ll go ahead and use the mark multiple times afterwards, and they don’t have to put it at every point.

The circle R means that it’s registered by the U.S. Trademark Office and it has a registration number that is currently active. Using the circle R, if your mark is not registered, is a big no-no. You are basically saying something that is factually incorrect. You are misrepresenting your mark as registered. That will get you into some big trouble.

Marc V: What if I never use it? What if I do register and trademark and I do all of those things? I never have to use it, right?

Seth G: You don’t have to use the circle R, but it is a helpful fact to litigation, if you have used it. When I’m working with a client, they’re going to be, let’s say you come to me and you say “Hey, we’ve been doing this podcast for a few years, and we want to register a trademark for it.”

I’ll say okay, and we’ll start the process. Then, I might say “Hey, by the way, you might put the TM in superscript, right on your website, so people know that you’re treating it as a trademark, and not anything else.” Then, we’ll work our way to the prosecution process.

Once it gets registered, I usually will send you a happy email with an attachment, and then a snail mail version of the certificate. And in one of those correspondences, I’ll say “By the way, you should start using the circle R now.” Because again, we had constructive notice, so the circle R is actual notice. If you’ve seen the mark, it’s up there.

It’s a helpful fact for you, if you have to enforce the mark.

Marc V: Okay. So to me, the way I think about it is -.

Mark S: Don’t mention a biker.

Marc V: I’m going to the biker. If the woman you’re seeing at the bar, if she has a wedding ring on, that’s like your circle registered R right there.

Seth G: Right.

Marc V: I don’t care if he’s in the bathroom. Look at her finger! You had plenty of notice.

Seth G: [inaudible 01:03:23]

Marc V: I love it. What else do you have, Mark? Do you have another one?

Mark S: I kind of want to wrap it up by saying that I think that Seth has demonstrated the attorney thing with the heart of a marketer.

Marc V: Yeah. I think so.

Seth G: [inaudible 01:03:54]

Mark S: You’ve provided us with a lot of great information, which I do appreciate. It will be on your plaque! Really, I think what I would like to end with is there are a couple of clear instances that we’ve talked about, where it just makes sense to talk to an attorney, not just about the trademark and copyright issues, but maybe getting your company set up, if you really plan on developing a big brand.

And there’s all kinds of things that we didn’t talk about, that an attorney for a small business might be useful, like how to deal with contract artists, and the work that they develop. The indemnification clause, things like that. What’s the best way for folks to approach you with this kind of question, for this kind of information?

Seth G: The best way is to send me an email. You’re welcome to call 888-317-3556. My partner is a corporate attorney, and we do federal – trademarks are federal work – we do a lot of federal securities extensions for people who are funding their companies. So, you’re welcome to call us, and we’ll either direct you to our corporate resource, or if we’re a good option for you, we’re happy to reach out and talk to you.

One of the things that you just mentioned is super important, that dealing with contract artists. If they are 1099, not employees, the default rule is they own any work, and you want to make sure that your documentation changes that. If I contract Mark to make me a logo, I want to own the logo. And if Mark’s not my employee, the default rule is that he still owns it.

Mark S: Interesting.

Marc V: Yeah, okay. That’s good stuff. And I think one thing that I want to say to finish off on all of this stuff is it’s really important to always exercise your gut of intent, when you’re going to create artwork. What’s my intent? Am I attempting to circumvent or cheat or represent something else?

And if your gut is saying “Yes, I’m attempting,” then you want to go ahead and do the right thing, whether it’s just not do that artwork, or maybe it’s time to get with an attorney and say “Hey, I’m building this brand. It’s coming off. Here’s my logos. I want to make sure everything is good. Can you help me?”

And then, the second is you mentioned it depends, and how important it is to understand that, and how there are not police going around. Just because you steal something doesn’t mean anyone is going to find it. And just because someone steals something from you, doesn’t mean that you are going to find it.

And if it is found, and it’s been changed by the 10%, now it involves “Well, I made a piece of art, and this person stole it from me.” Well, you can’t call the police. You have to get an attorney. The attorney is going to have to write something up. He’s going to have to contact them. Their attorney is going to have to respond, and it could turn into a lot of back and forth.

It might have to go to a judge, and it could cost tons of money, where a customer will ask “Should I do something about this?” It’s like you know what? It depends. You’ve got to consider that it’s not always cut and dried. You’re in a business, you’re in an art type of a business. It’s not always cut and dried.

So, act intelligently. Do your best to make good decisions, and consider “Hey, if I had to go up to an attorney, or if I had to take this to court, what’s my gut defense on this, and what am I going to tell my attorney?”

And I think that it’s important to just exercise all of your business practices like that, with good intent.

Mark S: Yeah. Don’t be shady.

Marc V: Don’t be shady.

Mark S: That’s the new Custom Apparel Startups logo. Don’t be shady. Listen, Seth. It has been a pleasure. Thanks again. I’m going to put all of your contact information in the show notes. I hope maybe we can do this again sometime, and ask a lightening round of even harder questions that you can’t answer without more details.

Marc V: And Custom Apparel Startups bears no responsibility for any advice given by Seth, his partners, associates or anybody he made reference to!

Mark S: Alright, everybody! Thanks very much for listening. This has been Mark Stephenson, from ColDesi.

Marc V: And Marc Vila, from Colman and Company.

Mark S: You guys all have a good business!